Gulacy's initial work as a Marvel freelancer was penciling the 15-page story "Morbius, the Living Vampire" in Adventure into Fear #20 (cover-dated Feb. 1974), written by Mike Friedrich and inked by Jack Abel. Following this came an inking assignment, over penciler Bob Brown on the superhero comic Daredevil #108 (March 1974). At some unspecified point during this time, Gulacy did a small amount of artwork for the pornographic magazine Hustler, explaining that comics artist Jim Steranko, whom he had met through Adkins,[3] had turned down what Gulacy called "a couple of jobs" and suggested Gulacy instead. "I did them. They offered me more and a lot of money, but I turned them down. ... I consider it a skeleton in my closet."[5]

In 1974, Gulacy began work on the character with which he became most associated, the philosophical martial artist/secret agentShang-Chi in the comic Master of Kung Fu (cover-billed as The Hands of Shang-Chi: Master of Kung Fu) #18 (June 1974), inked by Al Milgrom. That initial story and one the next issue were written by Steve Englehart, but issue #20 (Sept. 1974), co-written by Gerry Conway and Doug Moench, and the same month's Giant-Size Master of Kung Fu #1, written by Moench, marked the beginning of a Moench-Gulacy collaboration on the increasingly complex, cinematic feature about the son of longtime pulp fiction supervillain Fu Manchu, who teams with British intelligence to bring down his father's labyrinthine plans for global domination. With some exceptions, the writer-penciler team would continue through a serialized arc to issue #50 (March 1977), culminating with the apparent death of Fu Manchu.[6] Comics historian Les Daniels observed that, "Ingenious writing by Doug Moench and energetic art by Paul Gulacy brought Master of Kung Fu new life."[7] In 2010, Comics Bulletin ranked Moench and Gulacy's work on Master of Kung-Fu sixth on its list of the "Top 10 1970s Marvels".[8]

With writer Don McGregor, Gulacy created one of the first American modern graphic novels, Eclipse Books' Sabre: Slow Fade of an Endangered Species. Published in August 1978 — two months before Will Eisner's more famous, graphic short story collection A Contract with God — it was the first graphic novel to be sold in the new "direct market" of comic-book stores. Described on the credits page as a "comic novel" (the term "graphic novel" not being in common usage at the time), the trade paperback was priced at a then-considerable $6.00. It helped prove the new format's viability by going into a February 1979 second printing. Eclipse would publish a 10th-anniversary edition (hardcover ISBN0-913035-65-3; trade paperback ISBN0-913035-59-9) with a new Gulacy cover. A 20th-anniversary edition was published by Image Comics in 1998, and a 30th anniversary edition by Desperado Publishing in 2009.

Through the remainder of the decade, he drew primarily for Eclipse (the company's revival of the 1940s series Airboy and a new spin-off, Valkyrie) and Dark Horse Comics. Gulacy also began working for DC Comics with Batman #393–394 (March–April 1986), and the six-issue miniseries Slash Maraud (November 1987–April 1988), co-created with Moench. The two also collaborated on a series of eight-page chapters starring the superhero Coldblood which ran in the biweekly omnibus Marvel Comics Presents #26–25 (August–November 1989).[6]

In 2002, he combined his interest in science fiction and spy stories in DC Comics' S.C.I. Spy, and that same year returned to his signature character with his and Doug Moench's six-issue Marvel miniseries Shang-Chi: Master of Kung Fu (November 2002 - April 2003). Other Marvel work includes collaborations with writer Marc Guggenheim on the four-issue miniseries Squadron Supreme: Hyperion vs. Nighthawk (March–June 2007) and with writer Cary Bates on True Believers.[6][12]